Victorias Milling posts 39% hike in net profit

MANILA, Philippines - Listed sugar miller Victorias Milling Co. (VMC) registered a 39-percent growth in net income to P556 million for the financial year ending in August 2012 despite lower milling tonnage.

Production data  showed that ending Aug. 31,2012 the company milled 3.100 million tons of cane (TC), down from 3.116 million tons in 2011.

Despite this, the company’s raw sugar production rose to 6.500 million 50-kilogram bags (LKG) in 2012 from 5.709 LKG in 2011. Refined sugar production rose to 6.032 million LKG in 2011 from 4.382 million LKG in 2011.

The milling recovery rate rose to 2.06 50-kilogram bag per ton of cane milled (LKG/TC) from 1.83 (LKG/TC) in 2011.

“The slight reduction of milling tonnage this year by 0.5 percent against the previous year did not adversely affect raw sugar production volume because of the improvement in sugar recovery,” the financial report said.

The company noted that refined sugar production rose by 37 percent in 2012 because of major upgrades made in the refinery’s machineries.

Revenues for 2012 reached P4.6 billion, surpassing 2011 revenues by 11 percent because of higher tolling revenues.

The company’s core business which comprises the production of raw and refined sugar accounts for 98 percent of the revenues for 2012.

Raw sugar revenues fell by 0.42 percent year-on-year despite a 48-percent increase in volume sold as average selling price fell by 33 percent from P1, 908.90 per LKG in 2011 to P1, 283.35 per LKG in 2012.

Tolling revenues rose by 68 percent due to higher refined sugar withdrawal in 2012.

Molasses revenues, however, fell by 50 percent as average selling price fell from P6, 106.63 per metric ton (MT)  in 2011 to only P3, 133.67 per MT in 2012.

VMC earlier announced that it had set aside P288 million for the replacement of faulty equipment and renovation of facilities.

Around P181 million was also allotted for the rehabilitation of the distillery plant improve alcohol production.

The company operates the distillery plant to rake in additional revenues by producing alcohol from molasses.